Starwood Waypoint gets expanded $1 billion revolver led by Citibank

By Susanna Moon

Chicago, June 16 – Starwood Waypoint Residential Trust obtained a $1 billion secured revolving credit facility led by Citibank, NA as administrative agent, according to an 8-K filing with the Securities and Exchange Commission.

Interest on the loans is Libor plus 295 basis points for the first three years and then 395 bps for any extended term, with a default rate of an additional 500 bps.

The company entered into an agreement for an additional $500 million on its revolver secured by single family residences, according to a company press release.

The syndicate of banks includes Citibank as the lead arranger and bookrunner, Bank of America, J.P. Morgan Chase Bank, Goldman Sachs Bank and OneWest Bank.

The facility expires on Feb. 3, 2017 with a one-year extension option and an accordion that allows the company to expand the size to $1.25 billion.

The new facility replaces the trust’s $500 million facility with Citibank as the lender.

The unused fee ranges from zero to 25 bps, based on the amount outstanding.

In connection with the facility, the company purchased interest rate caps with an aggregate notional amount of $300 million for the initial term to protect against increases in monthly Libor above 3%. Continuation of that cap for an additional year, or purchase of a new rate cap, is a condition to any extension of maturity, the company noted.

“The significant expansion in the company’s credit facility provides additional capacity to create value for shareholders by allowing us to continue to invest in attractively-priced single family rental homes and non-performing loan pools,” Nina Tran, chief financial officer of Starwood Waypoint Residential Trust, said in the press release.

As of June 13, Starwood had tapped about $405 million and has about $595 million remaining.

The Oakland, Calif., REIT acquires, renovates, leases, maintains and manages single-family homes.

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